Inside Health

When Prescriptions Cost Less, Who Pays?

By DONNA KUTT NAHAS

Published: March 13, 2005

PAUL LIVERT of Oceanside has had to dig deep into his pockets for prescription drugs. Last year, he said, he shelled out $2,643 on a variety of medications for the kinds of ailments that come with reaching age 84.

''There's a blood thinner, pills for poor circulation, a slow thyroid, arthritis and a potassium deficiency,'' said Mr. Livert, a retired musician.

But in recent months Mr. Livert's prescription costs have been easier to swallow. He said that with the Nassau Rx card, a discount drug plan, instead of the $220 he previously paid in a typical month for prescription drugs, he shells out only $180.

''Forty dollars is an appreciable amount to save,'' he said. ''Nothing comes in but Social Security and the little money I have in the bank.''

The plan saves Mr. Livert and other Nassau residents about 20 percent on commonly prescribed brand-name and generic drugs sold in independent and chain pharmacies in Nassau and throughout the country. The card, introduced last July by the county comptroller, Howard Weitzman, to fight the rising cost of prescription drugs, has no age or income requirements and no enrollment fees. Residents with insurance and prescription coverage can use the Nassau card on drugs not covered by their plans, but not to reduce a co-payment or to receive an additional discount on a prescription.

County officials say those who benefit the most from the card are the 350,000 residents who have no insurance or drug coverage, or inadequate coverage.

There is no cost to county government, but an 85-cent administrative fee charged by Caremark Rx of Nashville, the pharmacy benefit manager Nassau County selected to oversee the prescription program, is built into the cost of the each prescription paid by the customer. Pharmacists who agree to participate in the plan have to pay the difference in drug prices, which averages about $18 per prescription.

While Mr. Weitzman touts the drug card as a boon to county residents, pharmacists argue that the price breaks eat into already lean profit margins. They say it's unfair to saddle pharmacists with virtually the entire cost of the program.

To remain competitive, pharmacists say they have no choice but to sign contracts to participate in national networks of drug discount cards or prescription programs sponsored by pharmacy benefit managers like Caremark. A contract obliges pharmacists to honor any card sponsored by the pharmacy benefit manager, explained Kirby Bessant, Caremark's vice president for consumer programs.

Some 92 percent of pharmacy customers have insurance or prescription coverage, and only about 8 percent of customers pay for their prescriptions out of pocket, said Craig Burridge, the executive director of the Pharmacists Society of the State of New York.

Mr. Weitzman said that more than 90 percent of the county's 345 pharmacies honor the Nassau discount drug card.

''This program could not be successful without their participation,'' said Mr. Weitzman, a former mayor of Great Neck Estates and a certified public accountant who once served as the chief executive of the Epic Health Group Inc., a mail-order pharmaceutical company. ''We have tried to work with them to help level the playing field, and as a result of our program, consumers who were paying retail no longer have to shop around for the best price.''

The program was unveiled to the public at a July 2004 news conference. Furious pharmacists phoned Mr. Weitzman later that month to voice their opposition to the program. ''After all, we are the ones footing the bill,'' said Howard Jacobson, a pharmacist who owns the Rockville Centre Pharmacy.

Joined by the county assessor, Harvey Levinson, Mr. Weitzman met with about two dozen pharmacists in August to discuss how they could cope with the financial fallout. According to Allen Morrison, a spokesman for Mr. Weitzman, Mr. Levinson explained how the pharmacists might apply for ''tax reductions on their commercial properties, which are based on their expectations of lowered income.''

But the pharmacists responded that many of them did not own the buildings their businesses occupied. ''What was he going to do for the pharmacists who are tenants?'' asked Don Cantalino, the Long Island representative of the Pharmacists Society of the State of New York, and the owner of Uniondale Chemists. ''And even if he did give us a tax break, was it going to make up for the money we lose on a daily basis?''

Mr. Burridge said Mr. Weitzman disregarded their objections because he ''probably wanted to get the card out quickly because he is running for office again and he hopes everyone who receives this card will remember him at the polling booth.''

For some pharmacists, the 20 or so customers who come into their stores each week to have their prescriptions filled with the discount card barely affect their bottom line. Others, however, are feeling the pinch.

Mitchell Melone, who owns Lakeville Pharmacy in New Hyde Park, said roughly 250 customers come in with the card each month. ''That translates into a loss of $2,500 in profits a month,'' he said, ''and in a year I stand to lose about $30,000.''